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Nick Clegg to "break taboo" of state housing support

11th June 2014

Liberal Democrat leader Nick Clegg has pledged to "break the taboo" of state support for housing.The deputy prime minister said he would borrow money to finance new homes, Bloomberg Businessweek reports. This money could be used to buy land or support construction by housing associations and local councils."Let's break the taboo, certainly that exists in the Conservative party, of doing the necessary to build the houses we need," he said."This is now emerging as one of the big long-term structural problems with the economy. Not only is it unfair because it prices young people out of the market altogether, it's actually a threat to the systemic stability of our financial system."The Liberal Democrat leader made the comments during a speech in which he outlined his party's economic position ahead of the next election.He told the audience his party would reduce Britain's debt ratio every year if the economy expands and eliminate the structural budget deficit by 2018. However, he said doing so need not preclude making investments in areas such as infrastructure and housing.The Liberal Democrat leader is looking to rebuild support for his party after a poor showing in the recent local and European elections. He sought to distance himself from the Conservatives' desire to shrink the state and the Labour party's tendency to borrow recklessly.Mr Clegg said public spending should grow roughly in line with the economy but made an exception for areas such as infrastructure and housing, where there is a pressing need for new investment.He claimed this was a different approach from Labour, as it prioritises the things the UK needs rather than borrowing indiscriminately.The deputy prime minister estimates that Britain needs 300,000 new homes a year to address rising demand and chronic undersupply.Recently, a number of high-profile figures such as IMF managing director Christina Lagarde and Bank of England governor Mark Carney have warned that house price inflation could pose a risk to the UK's economic recovery.